Sri Lanka tea prices tumble

Feb 12, 2009 (LBO) – Sri Lankan tea prices fell at this week’s Colombo auction with lower buying from key markets like Russia contributing to the decline, brokers said. The better teas were selectively sought after by shippers to Japan, Pakistan and possibly the Continent.

But there was noticeably less activity this week from shippers to UK and the Commonwealth of Independent States (CIS) which could be the main contributory factor for lower prices.

“The limited activity from shippers to CIS is possibly emanating from the rapid depreciation of the rouble vis-à-vis the US dollar,” Forbes and Walker Tea Brokers said.

Brokers Asia Siyaka Commodities said low grown leafy grades such as OP1 and BOP1 met with limited demand and prices fell sharply.

“There was however more demand for teas in the below best and poor categories which were sold at firm to dearer rates.” They attributed the lower demand from shippers to Russia to the rapid depreciation of the rouble against the dollar which made teas more expensive.

Prices fell despite improved quality and the lower volumes on offer.

Prices of low grown teas, which make up the bulk of the crop and